WHAT'S NEXT IN SOUTHEAST ASIA - SEIZING UNTAPPED OPPORTUNITIES IN ASIA'S NEXT GROWTH FRONTIER - Nielsen
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
WHAT’S NEXT IN SOUTHEAST ASIA SEIZING UNTAPPED OPPORTUNITIES IN ASIA’S NEXT GROWTH FRONTIER At Nielsen, data drives everything we do—even art. That’s why we used real data to create this image. Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 1
SMALL BUT MIGHTY
SEIZING UNTAPPED OPPORTUNITIES IN
SOUTHEAST ASIA
While sustainable growth opportunities are becoming harder and
harder to spot around the world, Southeast Asia is gaining momentum
and emerging as a growth engine for local and global companies alike.
This “Seizing The Untapped Opportunities in Southeast Asia’ report
reveals opportunities for growth in seven Southeast Asia markets.
WHILE SOUTHEAST ASIA ACCOUNTS FOR LESS THAN 3% OF
8 GLOBAL LAND AREA, IT IS HOME TO MORE THAN 8% OF THE
WORLD’S POPULATION
THE SEVEN COUNTRIES INCLUDED IN THIS REPORT ARE:
7 • INDONESIA
• MALAYSIA
• SINGAPORE
• THAILAND
• MYANMAR • VIETNAM
• PHILIPPINES
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 2SOUTHEAST ASIA AT A GLANCE Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 3
SMALL IN SIZE...
... BUT MIGHTY IN NUMBER
While Southeast Asia accounts for just 2.6% of global land area, it is
home to 8.3% of the world’s population - and its population is growing
faster than the population of the United States, China and the UK.
2.6%
OF GLOBAL
8.3%
OF GLOBAL
WHILE SOUTHEAST ASIA ACCOUNTS
FOR JUST 2.6% OF GLOBAL LAND AREA,
LAND AREA POPULATION
IT IS HOME FOR 8.3% OF THE WORLD’S
POPULATION
Source: Worldometers, http://www.worldometers.info/world-population/south-eastern-asia-population/ ; Nielsen What’s Next Starts Now database |8.26% of
global population represents 630,671,467
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 4POPULATION GROWTH IN
THE PAST 5 YEARS
SOUTHEAST ASIAN COUNTRIES ARE SURPASSING
GROWTH LEVELS IN THE US, THE UK AND CHINA.
POPULATION GROWTH IN THE PAST 5 YEARS (%)
USA 3.6%
UK 3.0%
CHINA 2.3%
INDIA 5.9%
SOUTHEAST ASIA 5.8%
PHILIPPINES 8.2%
SINGAPORE 8.0%
MALAYSIA 7.9%
INDONESIA 5.9%
VIETNAM 5.5%
MYANMAR 4.7%
THAILAND 1.5%
Source: Nielsen ‘What’s Next Starts Now’
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 5THE POPULATION IS
RELATIVELY YOUNG
WHILE COUNTRIES SUCH AS THE PHILIPPINES
AND MALAYSIA HAVE A RELATIVELY YOUNG
POPULATION, SINGAPORE AND THAILAND ARE
HOME TO AN AGING POPULATION.
SOUTHEAST ASIA 60%
PHILIPPINES
67%
MALAYSIA
63%
MYANMAR
62%
INDONESIA
61%
VIETNAM
58%
THAILAND
46%
SINGAPORE
42%
%STRONG ECONOMIC
INDICATORS
STABLE GDP GROWTH AND HIGH
CONSUMER CONFIDENCE
Over the past four years, Indonesia, Malaysia, the Philippines,
Singapore, Thailand and Vietnam have all seen stable GDP growth.
Consumer confidence in the region has also increased across the board,
with material improvements in optimism levels in Malaysia, Singapore
and Vietnam.
GDP GROWTH 2015 - 2018
7.0% 6.9%
6.7%
6.4%
6.1% 6.2%
5.6%
5.1% 5.2%
4.9%
4.1%
3.2%
3.0%
2.2%
2015 2016 2017 2018
INDONESIA MALAYSIA PHILIPPINES SINGAPORE
THAILAND VIETNAM MYANMAR
Source: Nielsen ‘What’s Next Starts Now’
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 7SOUTHEAST ASIANS
AMONG THE MOST
CONFIDENT IN THE WORLD
CONSUMER CONFIDENCE IS ON THE RISE
CONSUMER CONFIDENCE INDEX
(Q4 2016 - Q4 2018)
140
120
100
80
60
40
20
0
PHILIPPINES INDONESIA VIETNAM MALAYSIA THAILAND SINGAPORE
Q4 2016 Q4 2017 Q4 2018
Source: The Conference Board® Global Consumer Confidence™ Survey in collaboration with Nielsen
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 8CONSUMERS IN THE
REGION ARE DOING WELL
FINANCIALLY
Incomes are growing across the region, and consumers believe they are
better off than they were five years ago.
AVERAGE HOUSEHOLD INCOME DISTRIBUTION
4% 5% 6% 4% 6%
12% 10% 11% 9%
9% 10% 18%
17% 17%
23% 12%
17% 17% 48%
29%
56%
16%
38% 37% 23%
30% 37%
43% 19%
43% 32%
71% 39% 32%
16%
26% 28%
47% 46% 45%
30% 28% 19%
25% 13%
17% 16% 11%
6%
2008 2018 2008 2018 2008 2018 2008 2018 2008 2018 2008 2018
VIETNAM INDONESIA PHILIPPINES THAILAND MALAYSIA SINGAPORE
75+K 35-75K 15-35K 10-15K 5-10KA majority of Southeast Asian consumers believe that they are
financially better off than they were five years ago, particularly
developing economies such as Vietnam, Indonesia and the Philippines.
Not only are consumers financially
better off than they were, they are
also able to spend comfortably and
67%
ABLE TO SPENT
buy things just because they want
them. This is particularly true for
consumers in Singapore, where 67%
COMFOTTABLY
say that they are able to spend
comfortably.
CONSUMERS WHO FEEL FINANCIALLY BETTER OFF
THAN THEY WERE 5 YEARS AGO
86%
72% 75% 71%
58% 59% 57%
48%
GLOBAL SOUTHEAST VIETNAM INDONESIA PHILIPPINES MALAYSIA THAILAND SINGAPORE
ASIA
CONSUMERS PERCEPTION ON ABILITY TO SPEND
17% 24%
31% 30% 35% 30% 36% 35%
48%
48% 42% 51% 46%
53% 48% 67%
35%
15% 23% 23% 19% 19% 17% 9%
GLOBAL SOUTHEAST VIETNAM THAILAND INDONESIA PHILIPPINES MALAYSIA SINGAPORE
ASIA
I only have enough money for food, shelter and basics
I live comfortably and am able to buy some things just because I want them
I’m able to spend freely
Source: Nielsen Global Changing Consumer Prosperity Study (2018)
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 10IMPROVED SPENDING POWER
HAS LED TO HEALTHY FMCG
GROWTH IN THE REGION
All countries posted positive FMCG growth in 2018, with the biggest
growth seen in the Philippines and Malaysia.
FMCG VALUE GROWTH MAT Q4 2018 VS Q4 18
MYANMAR
THAILAND + 0.1% MAT
+ 4.7% QTR
0.5% MAT
3.9% QTR
VIETNAM
+ 4.3% MAT
+ 5.2% QTR
MALAYSIA
+4.9% MAT
+1.3% QTR
PHILIPPINES
+8.9% MAT
SINGAPORE +8.7 QTR
-0.5% MAT
+0.5% QTR
INDONESIA
+1% MAT
+1.3% QTR
ASIA PACIFIC * SOUTHEAST ASIA*
+ 5.4% MAT +2.3% MAT
+5.1% QTR +2.8% QTR
Source: Nielsen Growth Reporter * Excludes Myanmar
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 11CONNECTED CONSUMERS
INTERNET PENETRATION IS HIGH IN
SOME COUNTRIES
With high internet penetration in Southeast Asia, reaching 83% in
Singapore, 82% in Thailand and 77% in Malaysia, consumers are
not only well informed, but it is also becoming increasingly complex
for brands to reach and engage consumers. Traditional rules of
engagement no longer apply, in these economies.
INTERNET USERS (IN ‘000) PENETRATION (IN %)
4,800 SINGAPORE
83
57,000 THAILAND
82
25,000 MALAYSIA
77
64,000 VIETNAM
66
67,000 PHILIPPINES
62
143,250 INDONESIA
53
18,000 MYANMAR
33
Source: Internet World Stats March 2019
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 12CONVENIENCE IS MORE
THAN A STORE FRONT
GROWTH IN CONVENIENCE SEEN ACROSS
THE BOARD
The convenience/minimarket channel is growing faster than the total
market, pointing to consumers’ increasing demand for convenient
shopping solutions.
The biggest growth in convenience can be seen in Malaysia, where
convenience/minimarkets have grown by 17% (versus 5% total market
growth), followed by Vietnam where convenience has grown 13% while
total market growth is at 5%.
GROWTH OF CONVENIENCE/MINIMARKETS
TOTAL MARKET
VIETNAM +13%* MALAYSIA +17%
VS +4% VS +5%
INDONESIA +8% PHILIPPINES +10%
VS +1% VS +9%
SINGAPORE +0.1% THAILAND +7%
VS -0.5% VS +0.5%
Source: Nielsen RMS – MAT Q4 2018 *Vietnam = Modern Trade
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 13A DIVERSE REGION
BUT AMONG UNIQUE DRIVERS, LIE
COMMONALITIES AMONG MARKETS.
Positive economic indicators, along with healthy FMCG growth point
towards the immense opportunity for growth in the region, which
currently remains untapped.
However, there is no one-size-fits-all strategy to win, as each country
has its own unique characteristics that set them apart from each other,
as demonstrated below.
LOCAL MARKET DRIVERS
INDONESIA MALAYSIA MYANMAR PHILIPPINES VIETNAM THAILAND SINGAPORE
Increased Promotional Young Young Optimistic Aging Aging
Spending Driven Population Population Aspiring Population Population
Power Shoppers & Growing Consumers
Spending
Power
Convenience Growth Of Convenience Evolving Importance Of
Lifestyle Proximity Lifestyles Modern Retail Smaller Format
Stores Landscape
Connected Connected Connected Connected Connected Connected
Consumers Consumers Consumers Consumers Lifestyles – Consumer
E-Commerce &
Digital
Affordable Premiumisation Premiumisation
Indulgence
Outer Java New Regulation Category Emerging In-Store Growing Health
Opportunity – Sugar Tax Growth Esp. Middle Class Strategies – Key Consciousness
Rural (BPO & CFWs) To Success
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 14COUNTRY DEEP DIVES Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 15
INDONESIA Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 16
INDONESIA
INDULGENT SPENDING
Indonesian consumers’ savings has continued to increase, up 5,7% in
2018 versus 2017, however spending on leisure and lifestyle items has
risen. For example, dining out at coffee shops and fast food outlets have
increased from 40% in 2016 to 43% in 2018.
FUNDS FROM SAVINGS ACCOUNT + TIME DEPOSIT
(IN BILLION RP, Q3 2018)
3.535.222 3.943.517 4.168.082
2016 2017 2018
DINING OUT INCIDENCES
(COFFEE SHOPS AND FAST FOOD)
40 43 43
Q4’16 Q4’17 Q4’18
Source: Lembaga Penjamin Simpanan 2014 – 2017 / Customer penetration – Nielsen Consumer Media View
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 17INDONESIANS SEEK
INDULGENCE
INDULGENT CATEGORIES SEE GROWTH
Similar trends are observed in FMCG categories that consumers are
prepared to spend more on indulgence such as Liquid Milk (+9%),
Chocolate (+8%) and Mineral Water (+8%) which are experiencing
higher growth in 2018. Contributing factors included attractive thematic
packaging, variant innovation, increased distribution, variety of range
and affordable prices.
GROWTH IN “INDULGENT” CATEGORIES
+2% +5% +8%
BISCUIT SNACKS CHOCOLATE
+8% +9% +5%
MINERAL WATER LIQUID MILK SKINCARE
Source: Nielsen RMS.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 18GROWING MIDDLE CLASS
SEEKS CONVENIENCE
BOOM IN PROXIMITY SHOPPING
In Indonesia, with growing middle class and increasingly busy life,
proximity and convenience have become very important to consumers.
They want to spend less time to reach stores, especially in key cities
where congestion is a major factor. Small format stores continue to
grow with Mini-markets +9% (2017 vs 2018), contributing a third of total
market sales.
HEALTH & HEALTH &
HYPER/SUPER GENERAL
(%GROWTH) MINI MARKET BEAUTY BEAUTY
MARKET TRADE
MEDICAL COSMETIC
Dec ‘18 -4 9 -2 4 8
STORE GROWTH
Past 3
-3 10 -2 4 8
Months
Past 6
-5 7 -2 4 7
Months
Past 12
-4 8 -1 1 5
Months
2017 Vs
0 9 1 1 4
2016
1% 2%
12%
(%CONTRIBUTION)
32%
53%
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 19OPPORTUNITIES IN OUTER
JAVA ISLANDS
DRIVEN BY SPECIAL PROJECTS
Zooming in some regions of Indonesia, outer Java contributes more
than 48% of the total Indonesia FMCG with Sumatra, Kalimantan,
Sulawesi and Bali & Nusa Tenggara all growing faster than Greater
Jakarta as the government executes a lot of special projects in those
regions.
VALUE AREA CONTRIBUTION & VALUE GROWTH | FY 2018
INDONESIA FMCG TOTAL: IDR360 TRILLION
2017 STRATEGIC PROJECTS (#)
SUMATRA JAKARTA GR OTHER JAVA KALIMANTAN SULAWESI BALINUSRA
16 -1% 20.2 -1% 48.7 3% 5.2 3% 5.4 3% 4.5 1%
#14 #14
#9 PAPUA
#15
#12 (JAVA) #15
Note: Strategic projects include infrastructure development: Airports, Seaports, Toll roads, etc.
Source: Nielsen RMS.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 20MALAYSIA Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 21
MALAYSIA
VALUE MATTERS
Malaysia has enjoyed five consecutive quarters of consumer confidence
since Q1 2018, and consumers appear largely positive about the
country’s prospects in 2019.
Consumer optimism can be attributed to the historic general election,
in which Malaysia welcomed a new ruling party for the first time
since independence. The new administration has also enacted and
announced a number of changes to Malaysia’s tax policy that have had
an impact on consumer spending. Over the past few years, Malaysia
has seen a number of tax policy changes that have impacted consumer
spending behavior.
The most significant of these changes was the “zerorization” of the
Goods & Services Tax (GST) on 1 June 2018, and the subsequent
introduction of the Sales & Services Tax (SST) on 1 September 2018.
The move to effectively eliminate the GST was welcome by consumers,
as in the 3 years since the introduction of the GST in 2015, the prices of
goods and services had risen, as reflected in the Consumer Price
Index (CPI).
1 April 2015 1 June 2018 1 November 2018
HELLO GST! TAX HOLIDAY ANNOUNCEMENT OF
GTS RATE 0% SUGAR TAX
6 March 2019
DELAY OF
9 May 2018 1 September 2018 SUGAR TAX
GE 14 SST ERA TILL JULY 2019
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 22MALAYSIANS CRAVE
CONVENIENCE
PROXIMITY SHOPPING IS ON THE RISE
The retail landscape in Malaysia is evolving rapidly. The universe of
stores and channels are exploding driven by rapid urbanisation, the rise
in connectivity and consumers’ increasing demand for convenience.
In 2018, Malaysia’s FMCG market grew by 4.9%. During this time, trade
growth was driven by smaller format stores, with provision shops,
convenience stores and personal care stores each enjoying double digit
value growth. The boom in proximity retailing is further evident in the
increasing number of visits to mini markets, convenience stores and
provision shops over the past three years, while visits to hypermarkets
remained flat and supermarkets declined.
VALUE % VALUE %
SHARE OF TRADE CHANGE VS. 2017
TOTAL PEN
100% MALAYSIA 5%
HYPERMARKET -4%
SUPER/MINI MARKET 3%
PROVISION 10%
PERSONAL
CARE STORE 18%
CONVENIENCE STORE 17%
CHINESE
MEDICAL HALL 8%
ON PREMISE 11%
Source: Nielsen Malaysia Retail Index 2018 (80 categories, excl. cigarettes, beer & shandy), Peninsular Malaysia
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 23PRUDENT MALAYSIANS
SEEK VALUE FOR MONEY
PRICE SENSITIVE CONSUMERS SEEK
OUT PROMOTIONS
In Malaysia, as 59% of consumers believe they are financially better off
than they were five years ago. That being said, this improved financial
standing does not always translate into willingness to spend. In fact, the
majority of Malaysians we have surveyed over the past 10 years have
consistently said that they are most likely to save any spare cash that
they have after covering all essential living expenses.
As such, it is no surprise that Malaysians seek value for money when it
comes to shopping. Four in five consumers take advantage of special
offers/deals and make a lot of effort to buy groceries at the lowest
prices. In addition, 70% are sensitive to promotions and look at circulars
and coupons.
MALAYSIAN’S ATTITUDE TOWARDS PRICE AND PROMOTIONS
Price awareness of groceries
bought regularly 53%
Sensitivity to promotions 69%
I usually make a point of looking at
circulars and coupons 70%
I go to a lot of effort to buy my
groceries at the lowest prices
83%
I take advantage of a special offer
or deal 84%
YES NO
Source: Nielsen Shopper Trends 2018
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 24BUT ARE WILLING TO
SPEND GIVEN THE RIGHT
VALUE PROPOSITION
HIGH-PRICED RANGES ARE GROWTH DRIVERS
WITHIN DRUGSTORE / PHARMACY
Although Malaysians have historically been prudent spenders, there are
a number of categories that they are willing to spend more money on,
for example personal electronics such as computers, tablets and mobile
phones, clothing & shoes, cars, vitamins and cosmetics.
When making purchase decisions for such products, consumers place
a premium on products that come with high quality & safety standards,
items that provide superior function or performance and those that
contain organic or all-natural ingredients.
A prime example is within the drugstore / pharmacy channel, where
premium ranges are driving category growth.
CATEGORY PREMIUM SEGMENT
VALUE % CONTRIBUTION GROWTH GROWTH
TOTAL PERSONAL
CARE 44% +26% +31%
FACIAL CLEANSER 34% +17% +19%
MOISTURIZER 73% +11% +15%
TOOTHBRUSH 21% +28% +33%
TOOTHPASTE 44% +29% +32%
MASS REGULAR PREMIUM
Source: Nielsen Retail Audit, Total Drugstore / Pharmacy
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 25SUGAR TAX MAY CHANGE
PURCHASE BEHAVIOUR
New tax to be implemented on 1 July 2019
IMPLICATIONS OF SUGAR TAX
SUGAR TAX LIKELY TO IMPACT SOFT DRINKS CONSUMPTION AND
SALES, AT LEAST IN SHORT-TERM
SHOPPING FOR CARBONATED SOFT DRINKS IS HIGHLY PLANNED
AND LOYAL, BUT PRICE WILL BECOME A FACTOR IN-STORE
SUGAR TAX AND HEALTH CONCERNS ARE DRIVING GROWTH OF
“HEALTHIER” CATEGORIES
MANUFACTURERS RE-THINKING THEIR CARBONATED SOFT DRINKS
PORTFOLIO AND NEW PRODUCT DEVELOPMENT (EG LOW SUGAR)
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 26DIGITAL READINESS IS HIGH
HIGH INTERNET AND SMARTPHONE
PENETRATION HAS LED TO THE EMERGENCE OF
ONLINE SHOPPING
Internet penetration in Malaysia is high at 86%, while smartphone
penetration is at 76%. The proliferation of Internet usage in the country
has given rise to online shopping, with 11% of shoppers saying that they
have shopped online in the past month. Of this, 5% of shoppers say
that they have purchased food and groceries online in the past month.
Interestingly, the top three categories bought online are skincare,
shampoo & conditioner and diapers/baby wipes.
Source: Nielsen Shopper Trends Report 2019 and CMV Report, Peninsular Malaysia (Urban & Rural)
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 27MYANMAR Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 28
MYANMAR
STRATEGICALLY POSITIONED FOR GROWTH
Myanmar consumer comprises of 53.9 Million people recorded as the
28th largest population in the world.* They are young (with more than
half of the total population aged 10-34 years old), progressive, open
to trying new products and generally seeking an enjoyable shopping
experience.
22% 19%
54% 15%
TOTAL POPULATION BETWEEN 10-34 YO
53.4 M 24%
20%
10-17 YO 18-24 YO 25-34 YO
35-49 YO 50-64 YO
Source: The World Population Review*, The World Bank**, Consumer Media View 2018
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 29CONSUMER SPENDING ON
THE RISE
FMCG GROWTH DRIVEN BY FOOD AND
BEVERAGES IN RURAL MARKETS
Myanmar continues to be among the fastest growing economies in
the region with signs of consumers opening up and spending more on
FMCG consumption where most of the growth is being driven by Food
and Beverages in rural markets.
From 2017 to 2018, there is double digit growth in the categories such
as Tea mix (+18%), Fish Sauce (+11%), Energy Drink (+13%) which are the
categories with more than 50% penetration in the market. Household
and personal care products also show a promising growth in rural
markets with 6% growth in shaving razor, toilet cleaner and facial foam.
SEASONING
+11%
PRODUCT
TEA MIX +18% FISH SAUCE +11% POWDERED
+9%
MILK
ENERGY DRINK +13% CANNED FISH +9%
CHILI SAUCE +8%
BISCUITS/
NON-CSD +10% COOKIES/ +8% LEMON TEA +4%
WAFERS
HEALTH FOOD CONDENSED
+3% +5% SOYBEAN MILK +4%
DRINK MILK
CSD +2% SAVORY
+3% FRESH MILK +4%
SNACKS
MORE THAN 50% LESS THAN 50%
PENETRATION PENETRATION
Source: Nielsen MMRD Consumer and Media View 2018 vs 2017
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 30FASTER GROWTH FOR CHEAPER
AND MID-PRICED PRODUCTS
OPPORTUNITIES FOR PREMIUM PRODUCTS IN
LOWER MYANMAR
Cheaper and Mid-priced products are growing faster across the country,
but premium products have higher opportunities in Lower Myanmar.
Place of consumption also seems to be shifting as we see higher
consumption from Off-Premise outlets. Upcoming states like Bago,
Ayeyarwady and Sagaing provide exceptional growth opportunities.
+6%
Dishwashing Product +9%
Shaving Razor +8%
Shaving Razor, Toilet
Cleaner, Facial Foam Toilet Cleaner +10%
HILLY Shampoo +9%
Facial Foam +6%
+5%
Shampoo,
Mandalay
DRY
Body Lotion +6%
Facial Foam +6%
Naypyitaw
Body Lotion
Body Lotion +6%
PLAIN
+3%
Yangon
DELTA Dishwashing Product +6%
Dishwashing
Product
Toilet Cleaner +29%
SOUTH COASTAL Facial Foam +19%
+4% Body Lotion +14%
Fabric Softener +13%
Fabric
Softener Dishwashing Product +13%
Source: Nielsen MMRD Consumer and Media View 2018 vs 2017
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 31PHILIPPINES Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 32
PHILIPPINES
EMERGING MIDDLE CLASS DRIVES GROWTH
The Philippines is one of the emerging markets in SEA poised for
economic growth because of its consistently strong GDP performance of
6-7% over the last 5 years, which is bolstered by an evolving consumer
base.
The Philippines is one of the youngest populations in the world. Out
of the 107 million population, 52% are 23 years old or younger. The
country’s median age is at 24 years old, which means a healthy and
growing labor force and sustained future consumption.
11
22
16
107 M 24.3 YEARS OLD
MEDIAN AGE
POPULATION
52% 22 30
ARE GEN Z OR YOUNGER
GEN ALPHA GEN Z MILLENNIALS
(9 yrs old below) (10-23 yrs) (24-38 yrs)
GEN X BABY BOOMERS
(39-53 yrs) (54+ yrs)
Source: Philippine Statistics Authority 2019 projected population
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 33EMERGING MIDDLE CLASS…
The country is also experiencing an emerging middle class with a rise
in spending power. Two uniquely Filipino consumer bases are fuelling
this growth namely, business process outsourcing (BPO) workers
and overseas Filipino workers (OFW) families. OFWs now account for
about 10-12 million Filipinos, and their regular remittances to their
families make up 10% of the country’s GDP.
Meanwhile, BPOs continue to open up and expand in various cities in
the country, employing over 1 million young workers. The continuous
growth of both these sectors, whose earnings are way higher than
the average Filipino family, lead to higher spending power and
aspirational lifestyles.
OFWs BPO WORKERS
(Overseas Filipino Workers) (Business Process Outsourcing)
• 10-12 Million workers overseas • 1 -1.5 Million employed,
sending money to the PH giving jobs to young people,
even undergrads
• US$28 B in remittances -
contributes 10% of GDP • 24/7 retail environment borne
out of this huge sector
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 34… CHANGING SHOPPER
BEHAVIOUR
The emerging middle class is also apparent in terms of changing
shopper behavior. Based on Shopper Trends 2018, more shoppers
are saying they are able to spend more freely compared to a year ago.
Social classes D and even E which make up the bulk of the population
have registered an increase in grocery spend, while class ABC has spent
less on groceries. This decrease is attributed to class ABC’s increase in
out of home food spending as the need for convenience and the lack of
time drives more people to seek out more convenient food alternatives.
6-7%
2015 - 2018 GDP
MONTHLY GROCERY SPEND (BY SEC) PROSPERITY TO SPEND
ABC: PHP 7,623 -22% ABLE TO 16
SPEND FREELY
12
D: PHP 4,067 +9%
ABLE TO LIVE COMFORTABLY, 30
BOUGHT SOME THINGS I LIKED
E: PHP 3,367 +8% 29
ONLY ENOUGH MONEY FOR 48
Class ABC show decline in grocery spend SHELTER, FOOD AND OTHER
due to higher incidence of eating out
BASIC NECESSITIES 52
BARELY ENOUGH MONEY FOR 6
SHELTER, FOOD AND OTHER
BASIC NECESSITIES 8
2018 2017
Source: Shopper Trends 2018
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 35GROWING NEED FOR
CONVENIENCE
The rise in eating out is only one of the many signs of the country’s
growing need for convenience. With urbanization moving to more and
more cities, this leads to busier lifestyles where Filipinos are more time-
strapped than ever before. This calls just for the rise in popularity of
convenient shopping and eating alternatives such as growth of small-
format stores that are closer to homes, rise in eating out and also the
recent e-commerce boom.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 36MOBILE-FIRST MARKET
DIGITAL IS THE WAY TO ENGAGE MORE
FILIPINOS, ESPECIALLY THE YOUNG.
Along with the upsurge in spending power and the convenience lifestyle,
the Philippines shows great promise as it is a mobile-first country like
Indonesia and India. New internet users are smartphone users who
have started their digital immersion via a gadget that is literally attached
to them throughout the day. In Urban Philippines, 73% are already
internet users and this number is over 90% among Generation Z and
Millennials. Internet access shows no signs of slowing down, despite
relatively slower internet speeds in the country compared to our Asian
neighbors. As a mobile-first market with growing internet penetration,
the Philippines can be a captured and highly engaged audience for
marketers.
% USED INTERNET IN THE PAST 4 WEEKS
73
60 63
56
43 45
AMONG 10-19 YEAR OLDS - 94%
AMONG 20-29 YEAR OLDS - 92%
2012 2013 2014 2015 2016 2018
Source: Nielsen Consumer & Media View (Urban Filipinos) 2018
69 71
66 FILIPINOS SPEND THE MOST
63
60 58 60 TIME ONLINE*
56 54
51 52
45 4.58 HOURS
ONLINE ON MOBILE PHONE
Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018
SMARTPHONE OWNERSHIP
DAILY INTERNET USAGE
*Source: 2019 Global Digital Report (Hootsuite)
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 37SINGAPORE Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 38
SINGAPORE
TECH READINESS DRIVING DIGITAL ECONOMY
As 49% of Singapore’s population projected to reach above 50 years
by 2035, Singapore’s aging population highlights growing market
opportunities. It is key to win the heart of this silver generation, through
innovations like nostalgic packaging, and effective communications such
as familiar settings in advertisements and simple, clutter-free messages.
DEMOGRAPHIC BREAKDOWN OF SINGAPORE’S
POPULATION (%)
0-14 15-19 20-34 35-49 50-64 65+
12 15 19 23 27
22 23
23 23 22
24 23 21 20 19
20 19 18 17 16
6 6 5 5 5
16 14 13 13 12
2015 2020 2025 2030 2035
% ABOVE 50 YRS 34 38 42 46 49
PROJECTED
Source: What’s Next Start Now; Nielsen Turning Silver into Retail Gold
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 39DIET & EXERCISE ARE KEY
1 IN 4 CONSUMER SUPPLEMENTS REGULARLY
With an aging population, comes an increased emphasis on healthy
living, where 70% of Singaporeans highlight that they are at least
somewhat actively working towards better health and wellness. 62%
commit to eating healthily, and food that offers health benefits are
increasingly trendy and sought after. 1 in 4 also consume vitamins and
health supplements regularly.
ACTIVITIES DONE FOR HEALTH & WELLNESS
71%
GETTING SUFFICIENT SLEEP
65%
DRINKING PLENTY OF WATER PER DAY
62%
EATING HEALTHY
59%
REGULAR EXERCISE
25%
REGULAR CONSUMPTION OF VITAMINS AND
HEALTH SUPPLEMENTS
Source: Nielsen Health, Wellness & Nutrition trend in Singapore Report
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 40SINGAPOREANS CARE
ABOUT WHAT THEY PUT
ON THEIR BODIES
At the same time, natural or organic personal care products show major
category growth rates, where organic toothpastes (+169.8%) and hair
care (+27.5%) emerge as top performers. Evidently, Singaporeans are
becoming conscious not only about what they put in their bodies, but
what they put on their bodies as well.
HAIR COLOR HAIR CARE FACIAL CARE LIQUID SOAP TOOTHPASTE
CATEGORY VALUE
SGD 4.47M SGD 10.7 M SGD 3.80 M SGD 4.09 M SGD 1.37 M
NATURAL
13% 11% 7% 3%
25%
CATEGORY SHARE
NATURAL
75% 87% 89% 93% 97%
-7.2% 27.5% 6.4% -3.4% 169.8%
FOR ORGANIC / NATURALS FOR ORGANIC / NATURALS FOR ORGANIC / NATURALS FOR ORGANIC / NATURALS FOR ORGANIC / NATURALS
GROWTH RATE
CATEGORY
VS. VS. VS. VS. VS.
4.8% -4.7% -0.3% -4.3% -4.0%
FOR OVERALL CATEGORY FOR OVERALL CATEGORY FOR OVERALL CATEGORY FOR OVERALL CATEGORY FOR OVERALL CATEGORY
NATURALS OTHERS
NATURAL / ORGANIC SEGMENT SHOWING STRONGER GROWTH THAN OVERALL CATEGORY
(WITH THE EXCEPTION OF HAIR COLOR).
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 41TECH READINESS IS HIGH
PERCEPTION TOWARDS DIGITALIZATION
IS FAVOURABLE
Going digital is the way forward for a tech-ready nation like Singapore,
where digitalisation results in greater speed and seamlessness, and
convenient digital options are increasingly popular. 3 in 5 consumers
in Singapore are in favour of moving towards a cashless society,
while 3 in 4 stated that he/she will buy food and groceries online in
the next 6 months. This is a promising trend as online shoppers buy
twice the basket size and shop 25% more frequently. On average, each
Singaporean also uses almost 4 devices to connect to the Internet
with media consumption coming as one of the main reasons for going
online. Traditional media like TV, newspapers or books are far from
obsolete; they are still heavily circulated and consumed, but increasingly
more so in electronic forms.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 42THE WAY FORWARD IS DIGITAL
TECH-SAVVY SINGAPOREANS HAVE EMBRACED
DIGITAL TECHNOLOGY
DIGITAL IN SHOPPING
• 1 out of 10 Singaporean purchased
food and grocery online in the last
month.
• 3 out of 4 claiming that he/she would
buy food and groceries online in next
6 months.
DIGITAL IN PAYMENT
• 3 out of 5 consumers in Singapore in
favor of it becomes a cashless society.
• 42% are confident that Singapore will
become a cashless society in the near
future.
DIGITAL IN ENTERTAINMENT DIGITAL IN ORDERING FOOD
• Online as the preferred mode • Revenue in the Online Food Delivery
of media consumption among segment amounts to US$ 203 million
Singaporeans: in 2019.
• Revenue is expected to show an
66% TV / MOVIES / VIDEOS 49% NEWSPAPER annual growth rate (CAGR 2019-2023)
of 15.2%, resulting in a market volume
62% MUSIC 36% BOOKS
of US$ 358 million by 2023.
Source: Nielsen Survey among 400 Singaporeans in the age group 18-65 years, Nielsen Shopper Trends Report 2018, Statisca.com, Nielsen Connected Meters
Study - 2018
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 43THAILAND Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 44
THAILAND
AGING POPULATION PROVIDES GOLDEN OPPORTUNITIES
By 2025, Thailand’s aging population (50+ years old) is expected
to increase to 26.9 million, accounting for nearly 40% of the
total population. This demographic shift in Thailand brings in
opportunities, specifically for the FMCG market, delivery-service and
in-home care, where demand for products and services targeting elderly
consumers are expected to grow given the higher number of the aging
population in Thailand year-on-year.
Nearly 40% over the age
of 50 in 2025
Increase in 3.7 million
THAILAND
11.3M 4.3M 14.1M 15.7M 15.0M 8.8M 69.2M
16.4% 6.3% 20.3% 22.6% 21.6% 12.9%
0-14 YEARS 15-19 YEARS 20-34 YEARS 35-49 YEARS 50-64 YEARS 65+ YEARS SHARE OF
(Gen-Z) (Gen-Y) (Gen-X) (Baby Boomers) (Silver Gen) POPULATION
15.0% 5.9% 20% 20.5% 22.6% 16%
10.5M 4.1M 13.9M 14.3M 15.7M 11.2M 69.7M
-0.8M -0.2M -0.2M -0.6M +0.7M +2.4M
Source: EIU
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 45QUEST FOR CONVENIENCE
AS URBANIZATION AND INTERNET
PENETRATION IS ON THE RISE
Trends that are clearly seen in Thailand include urbanization, the
positive technologies adoption that comes with increasing access
to smartphones / Internet and greater demand for comfort and
convenience. The trend has contributed to the continuous rise of
convenience store with +7.5% growth in share of modern trade over the
past 3 years, the expected growth of internet users to 75% in 2025 as
well as the increase in e-commerce value penetration forecasted from
less than 1% in 2017 to 1.1-1.2% in 2022 ($488-510M).
%SHARE OF MODERN TRADE %VALUE CHANGE OF MODERN TRADE HOW OFTEN SHOPPERS VISIT
6
10.1 24 10
41.7 2016
47.2 43.7
1.7
49.2
29
27
5.9
2017
-8 28
27
56.3 58.3
50.8 52.8
7.4 12
2018 25
-1.1 8
2015 2016 2017 2018 SP / HP CVS
CVS SP/HP LESS OFTEN ONCE A MONTH
2-3 TIMES A MONTH ONCE A WEEK
2-3 TIMES A WEEK ONCE A DAY
OR MORE
4-6 TIMES A WEEK
Source: Nielsen Retail Index; Nielsen Syndicated Shopper Trends 2018
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 46INFRASTRUCTURE AND
ACCESS PROVIDE PLATFORM
FOR E-COMMERCE
E-COMMERCE PROJECTED TO BE VALUED AT
APPROXIMATELY US$ 500M BY 2022
E-COMMERCE VALUE PENETRATION
2017 2022THAIS PREPARED TO
SPEND MORE
RISING AFFLUENCE SEES PREMIUM PRODUCTS
ENJOYING HEALTHY GROWTH
With urbanization, consumer behavior is automatically heightened.
When consumers feel that they have better living conditions and
income, with access to the digital world that enables everyone to obtain
information faster and easier, the result is a need for a better quality
of living and a willingness to buy products and services at a higher
level. Thus, the market for premium tier products in Thailand enjoys a
good growth rate; it is also the main catalyst for the growth of various
product categories such as household, personal care and impulse. Given
the current income disparity between higher income consumers and the
evolving middle class, it is likely that the categories and innovations that
focus on indulgence and experiential offering will see stronger growth
appealing to the rising affluence of Thai consumers.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 48FMCG PREMIUM SEGMENT DECOMPOSITION
SHARE OF PREMIUM SEGMENT MAT 2YA
54
50 MAT YA
45
MAT TY
24 26 27
13 14 15 11 12
9
LOWER PREMIUM MID PREMIUM HIGH PREMIUM AFFORDABLE LUXURY
(PI: 1.2–1.5) (PI: 1.5–1.8) (PI: 1.8–3) (PI:VIETNAM Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 50
VIETNAM
CONNECTED CONSUMERS TO DRIVE SPENDING
Vietnam’s economy remains strong with GDP growth of 7.1% supported
by all sectors. Despite the recovery in the second half, FMCG ended
the year with a modest growth of 1.9%. One reason for this could be
attributed to slower pace of innovation in FMCG compared to the high
willingness of consumers to try new products.
WILLING TO TRY NEW INNOVATIONS
VIETNAM 78%
GLOBAL 62%
FMCG INNOVATION IS STILL BEHIND OTHER CATEGORIES
BRANDS ASSOCIATION
FMCG 23% 46% 48% 56% 25%
INNOVATIVE REPRESENTATIVE TIMELESS /CLASSIC VALUE FOR MONEY PREMIUM HIGH
QUALITY
Pioneer in
Reflect Vietnamese Premium & High
developing new Timeless/Classic Affordable Price
values & cultures Quality
products
Source: Vietnam’s GDP is reported by GSO Vietnam. FMCG growth from Nielsen Retail Audit
Report: Vietnam Consumers of Tomorrow - Gen Z
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 51RISE IN CONNECTED
CONSUMERS
SPURRED BY ECONOMIC GROWTH AND RISE
IN INFRASTRUCTURE
Sustained growth in economy and infrastructure has also given rise to a
significant chunk of connected consumers which have already reached a
developed level and expected to contribute almost USD 99Bn in annual
spending by the year 2025
2017 2025
23 Mil. People 40 Mil. People
CONNECTED CONSUMERS*
50 Bil. USD Spending/ 99 Bil. USD Spending/
Annum Annum
38% of Total Spending CONNECT TO WILLING TO 48% of Total Spending
INTERNET SPEND
Source: Institute Research of Consumer Behavior
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 52MODERN TRADE A BRIGHT SPOT
BUT COMPETITION IS HIGH
This overall growth in economy has also led to channel fragmentation
to match the evolving and fast paced need of the consumers. As a
result strong growths was observed in e-commerce, specialty stores
and Modern Trade. Modern Trade in particular has been a bright spot
growing at 13% enabled by explosion in smaller format stores. However
this channel is not easy to crack with higher competition from local
players, private label and imported products.
~56% ~56% ~77% ~63%
Categories have Categories have Categories have Categories have
more new launches tougher competition* imported products different top 3
in MT than TT, in MT than TT, increasing importance, brands in TT vs. MT,
especially... especially... especially... especially...
BEVERAGE MILK-BASED PERSONAL CARE PERSONAL CARE
PERSONAL CARE FOOD HOME CARE FOOD
WIN IN TT DOES NOT
MORE NEW LAUNCHES MT IS BECOMING MORE IMPORTED PRODUCTS
ALWAYS MEANS THE
OBSERVED IN MT FRAGMENTED POSE A THREAT IN MT
SAME IN MT
Source: Nielsen Retail Audit data ending Jun’18.
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 53IMPORTANCE OF SEMI-
RETAILERS ON THE RISE
MARKETERS MUST UNDERSTAND REGIONAL
MARKET DYNAMICS
On other hand, Traditional stores with over 1.4mn base presents its
own challenges. To succeed in different regions, marketers will require
to strike a balance between higher store density areas in South vs the
higher footfall/store in North and Central“.
TRADITIONAL TRADE STILL DOMINATES WITH
INCREASING IMPORTANCE OF SEMI-RETAILERS (*)
Semi-retailer stores for TT Retailer stores for FMCG
FMCG in Vietnam (2017) in Vietnam (2017)
25,371 1,485,747
+2% +0%
Semi-retailer store growth Retailer store growth 2017
2017 vs. YA vs. YA
NORTH CENTRAL SOUTH
% population 36% 37% 27%
% area 35% 45% 20%
% retail stores 29% 24% 47%
Store density (stores/
3.8 2.4 10.8
km2)
People/store 75.4 96.5 35.1
FMCG sales/store (Mil.
13 18 16
VND/month)
Note: SKUs down to packsize. Retail Audit MAT Nov’18 data
Opportunity Challenge
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 54ABOUT NIELSEN
Nielsen Holdings plc (NYSE: NLSN) is a global measurement and data
analytics company that provides the most complete and trusted view
available of consumers and markets worldwide. Our approach marries
proprietary Nielsen data with other data sources to help clients around
the world understand what’s happening now, what’s happening next,
and how to best act on this knowledge. For more than 90 years Nielsen
has provided data and analytics based on scientific rigor and innovation,
continually developing new ways to answer the most important
questions facing the media, advertising, retail and fast-moving consumer
goods industries. An S&P 500 company, Nielsen has operations in over
100 countries, covering more than 90% of the world’s population. For
more information, visit www.nielsen.com.
THE SCIENCE BEHIND WHAT’S NEXT ™
Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 190824 55THE SCIENCE BEHIND WHAT’S NEXT™ At Nielsen, data drives everything we do—even art. That’s why we used real data to create this image. Copyright © 2019 The Nielsen Company (US), LLC. Confidential and proprietary. Do not distribute. 56
You can also read
